Where are the development of bank cards headed? - Part 2

2018.02.13. 08:00 | Hírek

In the previous part of the series, we discussed that several inventions are linked to bank cards, which are present on the plastic even today. These include the plastic as material, the magnetic stripe, the hologram, the photo or the chip. Only the contactless payment was the one that was born in the last 17 years from those solutions that are spread globally. Did we invent everything that can be linked to bank cards, or quite the opposite: the big boom comes now? We are looking for the answers with Bancard Ltd. experts in a four-part series of articles.

Did really nothing happened with bank cards since the introduction of contactless payment?

The first public contactless transaction was carried out in 2016 by Péter Braun, deceased since, at Coffee California in Múzeum street, Budapest, who - retired from working as the head of the Hungarian CIO Association and IT and logistics division of OTP Bank in 2001 - achieved undying merit in IT development in Hungary.

If we look at a bank card, we don’t see much development since plastic. CIB Bank introduced the last innovation in the Autumn of 2012: if the card holder rubbed the coffee-designed credit card, he/she could feel a mild coffee scent, until the card’s aroma lasted. As the solution wasn’t a breakthrough, it didn’t spread in Hungary, and even CIB stopped the development of the scent series.

Displays on bank cards

However, a much more crucial innovation came to light, which was announced in 2010, although it starts to spring up nowadays. Mastercard chose Hungary in June 3rd, 2010 to announce a worldwide novelty that was not put into use ever since: a payment card with built-in number display and buttons came out, and could be ordered in Turkey on this day.

Image of the first display card from Mastercard - several versions with buttons were made (source: Bankkártya.hu)

This card is exactly as thick as the other bank cards, and the battery and buttons still fit in. What’s more, the display card can be bent to some extent the same way as the non-display ones. Knowing these it may not be surprising that it took nearly a decade to develop the product until it was able to withstand extreme temperatures and the battery would not run down in the first year.

The development of the display and buttons on bank cards started somewhere in the beginning of the 2000’s, when today’s dominating smart phones only existed on the design board at best, as well as the touchscreen on phones, however, this latter had existed from 1994 on a mobile phone called IBM Simon.

It was completely understandable that the payment technology developers had bank card development in their heads, instead of mobile phones, with heavy duty display and miniaturized battery cells, as mobile phones were only pioneers at the time: the first mobile phone with camera, the Sharp J-SH04 came out in November 2000, the first that supported Bluetooth was Ericsson T-39 and it was released in 2001, the first device that utilized memory cards was Siemens SL45, or the first mobile that was able to transfer data via GPRS was Siemens S45. The first phone supporting 3G was not released until 2004 with Nokia model 6630, while the consumers preferred Nokia 1100 at the time, which had been the most marketed mobile phone in the world according to Reuters in 2007 with 200 million phones sold. (source)

Image of a Nokia 1100 from eBay from December 2017, the most popular mobile phone at the time, released in 2003 - could not meet today’s demands yet (source)

The card features display and buttons exactly because according to Mastercard research, consumers need card use to be simple and secure. The researches showed that card holders pretty much needed the balance information before and after purchase, i.e. better tracking of their money.

On one type of card, there is only one button and a display. The features here can be selected by pressing multiple times or pressing and holding the button, including the battery status or card software version beside the balance. On the other type of card, a keypad can be found beside the display, which enables the card holder to use the bank card as a token for internet banking log in or internet payment combining payment and token in one card.

Although this was an innovation breakthrough after the chip and the contactless feature and it was the first time a bank card included an actively powered circuit (contactless payment gained the energy from the electromagnetic field of the POS terminal) the world didn’t rise to the bait. The reason for this is that viable phone model that were able to pay with had emerged by then, which continue to determine mobile device design and services up until today. While the smartphone revolution have been going on silently since 1994, the breakthrough was the release of the intuitive and user friendly iPhone in 2007, which laid the foundations of the general use of smartphones today.

So the development of mobile phones caught up with display cards by 2010. Although it was not obvious at all in 2010, today we’re sure the world of display cards was replaced by the world of bank cards behind the mobile phone screen. To be fair, it’s not past tense for now, as it is likely that we’re going to pay with a physical bank card for a long time, but the increasing rate of mobile phone payment can’t be reversed now.